Bloomberg

Bloomberg | Quint is a multiplatform, Indian business and financial news company. We combine Bloomberg’s global leadership in business and financial news and data, with Quintillion Media’s deep expertise in the Indian market and digital news delivery, to provide high quality business news, insights and trends for India’s sophisticated audiences.

White-Collar Prosecutions Fall to 20-Year Low Under Trump

(Bloomberg) -- The number of white-collar prosecutions is on track to hit a 20-year low under President Donald Trump, after reaching a high in 2011 during the Barack Obama administration, according to a nonprofit research center that analyzes government data.

A total of 3,249 cases were brought during the first seven months of the U.S. government’s 2018 fiscal year, which runs from October 2017 to April 2018, according to a case-by-case analysis of government data by Syracuse University’s Transactional Records Access Clearinghouse, or TRAC.

That’s a 4.4 percent drop from the same period in 2017, a decline of 33.5 percent from five years ago, and 40.8 percent fewer cases than in 1998, according to the report. The analysis is of data obtained by TRAC under the Freedom of Information Act.

If the recent downward trend continues at the same pace, TRAC estimates the annual total of white-collar prosecutions will be 5,570 for fiscal year 2018.

Deputy Attorney General Rod Rosenstein said Wednesday that the Trump administration was committed to fighting white-collar crime and pointed to recent cases alleging health-care and securities fraud.

“Our goal is to deter crime, and we can only do that by holding accountable the perpetrators who break the law to gain a competitive advantage,” he said at the Bloomberg Law Leadership Forum in New York.

But he also said that the Justice Department will “reward companies that try in good faith to deter crime” through corporate-compliance programs “that help to prevent problems, and help detect any wrongdoing quickly.” Under the new policy, he noted, prosecutors last month elected not to prosecute a company for overseas bribery because it “demonstrated responsible corporate conduct after discovering a violation.”

Clinton, Bush

Reviewing figures from 1998, TRAC found that there were more than 9,000 white-collar cases filed during the administrations of Presidents Bill Clinton and George W. Bush until 2004, when the number fell below 9,000, according to the report.

In 2007, the number of white-collar prosecutions began to increase again, and then fell back after an all-time high of more than 10,000 in 2011. A year later, the number of white-collar cases dropped to just over 8,000 and remained at about the same level until 2013. The number of cases has steadily fallen since then, with fewer than 6,000 cases filed in 2017.

The lead investigative agency to bring white-collar prosecutions from October 2017 through April 2018 was the Federal Bureau of Investigation, which accounted for 32.7 percent of cases, followed by the Secret Service with 10.8 percent, the Internal Revenue Service with 10.1 percent and the Postal Service with 8.7 percent.

So far in fiscal 2018, the federal prosecutor’s office in Manhattan continues to be the most active, bringing 76 white-collar cases per 1 million people. The office in south Florida ranks second with 59. There are 17.2 white-collar prosecutions per 1 million people in the U.S.

Jonathan Sack, a former federal prosecutor in Brooklyn, New York, said many white-collar cases are built on large volumes of electronic data, which tend to prolong investigations.

“I would hesitate to conclude too much from an apparent decline in the number of white-collar prosecutions,” he said. “The current numbers no doubt have many causes, including the length of time it now takes to investigate some white-collar offenses, not a decline in effort or interest on the part of law enforcement agencies.”